In my mind, yes, it absolutely was stopped early. Fights usually get stopped on a fall from one big hit if the fighter is visibly knocked out or if they had been taking sustained/heavy damage prior to being knocked down . Neither of those two was the case here, imo.

UPDATE:Frank Mir had this to say about the stoppage when asked about it at the post fight press conference:

"Obviously I thought it was a bad stoppage," Mir said in the post-fight press conference. "We're fighters. If every fight was stopped on any kind of a flash shot or anything like that — actually, I took the knee, and I remember going, 's--- I'm in a bad position.' And that's why I dropped my other knee out from underneath me so that could fall to the ground and make sure I didn't take a second one. I didn't belly out, I didn't flatten out, and I actually tried to redig my underhook so that i could get a single. And I actually looked at the referee stopping it. "And then at first I thought, maybe I was out? Did I take a bunch of shots that didn't see? And then after watching it, I was conscious the whole time. Even when I stood up I wasn't wobbled, I was completely coherent. So at best your argument is it was a flash knock down. I didn't know fights stopped on that. If that was the case I never would have beaten [Antonio Rodrigo] Nogueira, I don't think we would have seen Travis Browne knock out [Alistair] Overeem last week. There are too many fights in our sport that are exciting, and you've got to let us fight. I didn't sign up for a tennis match. It's nothing against Josh, he's a great fighter and he did what he had to do."

Well that certainly is interesting, isn't it? On the one hand the fact that he (at least claims to have) dropped down by choice to avoid further damage and attempt to initiate a takedown makes this stoppage all the more annoying for the fans and seemingly unfair for the fighter but on the other it actually lends the referee in this case a little bit of a sympathetic light in which he can be viewed- I mean, if fighters are going to be dropping to the mat on purpose and this looks indistinguishable from a knockdown, well, I'd hate to be a referee in a main event.